Gov. Greg Abbott prepares to deliver his State of the State address, flanked by (l.-r.) Lt. Gov. Dan Patrick, state Rep. Senfronia Thompson, D-Houston, state Sens. Donna Campbell, R-San Antonio, and Kel Seliger, R-Amarillo, and House Speaker Joe Straus.
Bob Daemmrich for The Texas Tribune

Editor's note: This story has been updated throughout.

Texas Gov. Greg Abbott on Tuesday laid out a largely expected agenda for the 85th legislative session while declaring four issues as emergencies for lawmakers to take up immediately: banning so-called "sanctuary cities," overhauling the state's broken child welfare system, implementing ethics reform and approving a resolution to support a convention of states to amend the U.S. Constitution.

In his State of the State address, Abbott said Texas remained "exceptional" and expressed optimism that the state's economy would bounce back from an oil downturn. At the top of his priority list for lawmakers was the child welfare system, which a federal judge declared broken in 2015 and lawmakers have since been scrambling to overhaul.

"Do not underfund this rickety system only to have it come back and haunt you," Abbott told lawmakers in a joint session of the Texas House and Senate. "If you do nothing else this session, cast a vote to save the life of a child."

Beyond emergency items, Abbott announced Tuesday he was directing state agencies to impose a hiring freeze as a way of dealing with the state's tight budget. He said the move would free up about $200 million in the current budget.

"They nod in the direction of pre-K, but they turn a blind eye to the goal of achieving high-quality pre-K," Abbott told lawmakers. "If you're going to do this, do it right or don't do it at all."

Abbott's proposed budget, released after his speech, puts $118 million a year toward the pre-K program. That's double the $59 million per year lawmakers put toward the project in the current budget and far more than either chamber has offered so far for the next budget. The proposed House budget maintains the current funding while the Senate's proposed budget increases it to $75 million.

Abbott did not mention what could end up being the most controversial legislation of the session: the "bathroom bill" being pushed by Lt. Gov. Dan Patrick. Senate Bill 6 would restrict people to use public bathrooms that correspond with their "biological sex," and Abbott has taken a largely neutral stance on it so far.

Abbott also made little mention of President Donald Trump, though he announced he will meet Tuesday with Trump's Homeland Security secretary, John Kelly, in the Rio Grande Valley. While the state’s Republicans are hopeful Trump will provide relief to their long-running border security efforts, Abbott indicated his budget will maintain the $800 million in additional funding for the issue that lawmakers approved last session.

"Texas will not flinch in our resolve to keep Texans safe," Abbott said.

Abbott earned perhaps the loudest applause when he said this session will be the one lawmakers ban "sanctuary cities" — places where local officials do not fully cooperate with federal immigration authorities. Abbott has been locked in a standoff with Travis County Sheriff Sally Hernandez over the issue, though he did not mention her in the speech.

On ethics reform, Abbott applauded lawmakers for crafting legislation this session that avoids “the pitfalls that led to the demise” of it in 2015. Ethics reform was also among his emergency items that year.

And on the convention of states, Abbott made clear the election of President Donald Trump, a fellow Republican, does not change the need to repair the Constitution.

“It must be fixed by the people themselves,” Abbott said.

Beyond his four emergency items, Abbott touched on a litany of issues that have already sparked spirited debate under the pink dome. Among them is education, an issue where the two chambers have prioritized different approaches.

“Both the House and the Senate are right to tackle the vexing issue of school finance now rather than putting it off,” Abbott said, while also nodding to a Patrick priority that has gotten a chilly reception in the House. “Let’s make Texas the 31st” state that offers school choice, Abbott added, pitching a program that would let parents use public money to send their children to private schools.

Abbott also called for lawmakers to fully fund the Texas Enterprise Fund, the so-called "deal-closing" fund the state uses to lure businesses from elsewhere. Some conservatives view it as the government picking winners and losers, but Abbott emphasized its continued importance, noting Texas recently lost to Arkansas a recent investment by the gunmaker Sig Sauer.

Abbott repeatedly acknowledged that lawmakers have less money to work with this session than they did in 2015. Yet he expressed little concern about the squeeze’s ultimate effect, especially with his new hiring freeze in effect.

"I am confident we are going to be able to balance the budget without looting the Rainy Day Fund,” Abbott said, referring to the state’s politically touchy savings account. Largely fed by taxes on oil and gas development, the fund is projected to have a balance of $11.9 billion at the end of the next two-year budget if lawmakers don't tap it this session. Some House leaders have suggested using the fund this session to address some key funding concerns.

Despite the tight fiscal picture, Abbott continued to push for tax relief, emphasizing his desire to see further cuts to the business franchise tax. Ideally, Abbott said, the tax will be trimmed “until we can fit it in a coffin.”

Abbott also pushed for "serious property tax reform with a real revenue cap," describing a proposal by state Sen. Paul Bettencourt, R-Houston, as "on the right track." Bettencourt's bill would further restrict local officials' ability to raise property taxes without voter approval.

Democrats took note of both what Abbott said and what he didn't say during his hour before lawmakers. Some were encouraged he did not bring up the bathroom bill, which has faced stiff resistance from the business community.

On Trump, though, Democrats said Abbott missed an opportunity.

“It’s disappointing that Gov. Abbott didn’t use his position of prominence to show his disapproval of some of the misguided policies from the Trump administration,” state Rep. Chris Turner of Grand Prairie told reporters, referencing the proposed 20 percent tax on Mexican imports and the “unconstitutional Muslim ban.”

“Particularly on the Texas Muslim Day at the Capitol, it’s unfortunate he passed up the opportunity to make his position clear on the issue,” added Turner, who leads the House Democratic caucus.

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